Alistair Darling: I would say that the support that we have made available to the banking system is fully justified. It was necessary—as I said, it is a necessary precondition of recovery. We have also put in place a number of measures: the hon. Gentleman mentioned the enterprise finance guarantee scheme, which is helping 2,000 businesses. We now have support for exporters and other measures of support, too.
	I hope that when the hon. Gentleman spoke to the BRC he pointed out that what would have happened had he had his way, as he was against every single one of the measures. I am always interested to hear his concern about what we are doing, but he ought at least to stand up and say, "By the way, I would not have done any of these things", as his Leader of the Opposition made clear at the weekend.

David Kidney: One of the many damaging aspects of the greed and recklessness of the bankers is that markets do not know the extent of the losses that they made in those deals. In cases where the British taxpayer now has a stake in banks, are we getting to the bottom of those losses so that we can start to restore confidence in markets?

John Baron: Does the Financial Secretary understand that my constituents were fed up with paying more taxes under this Government, even before the Chancellor doubled the national debt? No-one is fooled: a 50 per cent. tax rate may make it look as though the rich are paying more tax before the election, but after the election it will be average earners who are paying even more tax, because of increases in fuel duty and national insurance contributions, which by 2012 will cost every family in this country an additional £1,000.

Stephen Timms: Among the pieces of information that the hon. Gentleman gives his constituents, I hope that he will point out that they will pay less as a proportion of their income in direct tax in 2011-12 than they did in 1997 and that every basic rate taxpayer is, with effect from this month, benefiting from a £145 tax cut, thanks to the increase in personal allowances, which exceeds future national insurance rises. I hope also that he will have the courage to admit to his constituents that the Conservative party's only tax promise to date is to increase the inheritance tax threshold to beyond £1 million, which would do nothing at all for 97 per cent. of estates, but would give an average of a £200,000 tax cut to a tiny handful—3 per cent.—of estates. His constituents might have second thoughts when he explains that to them.

Stephen Timms: I say to my hon. Friend that I hope that Michael Caine is not going to leave the country, but I agree with him that at a time of crisis in the world economy, it is fair to ask those who are in a position to do so to contribute more.

Ian Pearson: The Government recognise the importance of saving in providing people with independence throughout their lives, security if things go wrong, and comfort in retirement. Budget 2009 announced that from April 2010, the annual individual savings account investment limit will rise to £10,200, up to £5,100 of which can be held in cash. Those new limits will apply from October 2009 for people aged 50 and over. The Government also announced an extra £100 a year for the child trust funds of disabled children, with £200 per year for severely disabled children. In addition, the saving gateway will be introduced nationally in 2010 to encourage saving among people of working age who are on low incomes.

Alistair Darling: Sadly, I did not have the benefit of listening to the Polish Prime Minister, but I am glad that Poland has managed to do so well over the past few years. I am sure the hon. Gentleman will recognise that there are differences between Poland and other countries. If we look around Europe—I am glad that Opposition Members are now prepared to look at Europe and cite other European countries with approval; that is certainly different from how it used to be in the past—the more developed economies in Europe have experienced exactly the same difficulties as we have, as America has and as Asian countries have. There is no country in Europe, Poland included, advocating the present policies of the Conservative party.

Natascha Engel: As I am sure that my right hon. Friend the Chancellor is aware, I have recently been involved with setting up the all-party group on insolvency. With that in mind, will he tell me what he is doing to fight the culture of fear that exists around insolvency and often prevents businesses and individuals from seeking help before it is too late?

Nick Harvey: I, too, wish to put on record my respect and admiration for the reserves, who are undoubtedly a valuable part of our armed forces. We have used them more and more in recent years, sending them to the front line much more than previously, and it is no surprise that the National Audit Office observed in its report that there are parts of the armed forces that simply could not manage without the reserves.
	I thank the Minister for his statement and for advance sight of it, but it poses more questions than it answers and it is scant on detail. He tells us that there are seven strategic recommendations and 80 detailed ones. I notice that he was on his feet for 14 minutes and I should have thought that he could at least have told us what the seven strategic recommendations are in that time. Can he guarantee that we will get a further chance to ask questions when we have had sight of them? We have no idea of the extent of the changes that are being considered, or whether they will cost more or less. Nor do we have any sense of the timescale for the introduction of the measures or the likely impact on the wider armed forces.
	The NAO also observed that reserve forces cannot be a substitute for the regular armed forces, given the inherent limitations in training time and the fact that they are not able to deploy as quickly as high-readiness forces. The Minister must surely accept that nothing in this review can change that.
	We know that we will have an ongoing role in Afghanistan for many years, and we will be involved in the Balkans for some time yet. Given the burden that we have placed on the Territorials in recent years, can the Minister give us some indication of what that will mean for their numbers? If after everything that they have done their numbers are cut, it will feel like a slap in the face.

Bob Ainsworth: I thank my hon. Friend for that question and I am not surprised that he is concerned. The decision that we have taken is not about the facilities in his constituency, but about the capability provided by the Signal Regiment that is only a part of, and only one user of, those facilities. As I have said, it uses equipment that is now obsolete. I am happy to meet my hon. Friend to see whether we can find ways of continuing to use the facilities—if they are as good as he says, we should certainly do so. We need to maintain our support to the Army and Navy cadets.

Brian H Donohoe: May I first put on record my appreciation of the work done by the two Territorial Army units in my constituency? Will my right hon. Friend explain exactly how these new and additional resources will be made available to them? Like my right hon. Friend the Member for Kilmarnock and Loudoun (Des Browne), may I too make a bid, in this case for the super-garrison to be in my constituency, in Central Ayrshire?

David Hamilton: I agree with the aspirations set out in the statement, but I am concerned that I am no wiser about some of the points that have been made because the statement was thin on the proposals, although I will read the report when it comes through. Will the Minister assure us that we will have a full debate before we get into the details in which we can not only discuss the acquisition or relinquishing of property, but cover the whole thing at one time? I get the feeling that we are talking about getting rid of some of the property without dealing with the bigger issue.

Bob Ainsworth: The principle espoused in General Cottam's review is that we should have the best person for the job. That is the recommendation against which the hon. Member for New Forest, West reacted—recommendation 50. General Cottam and I have already discussed the matter and we agree that, in deciding who is the best person for a job, we should take account of the unit's being a reservist unit, and the fact that the commander is a reservist will often be part of that assessment. As I said, sometimes the chain of command will decide for good reason that, at a particular point in time, it is appropriate that a regular officer commands a unit. However, we do not want to damage the career path—the ability to bring capable individuals into the officer corps—and we will do that if we take that too far.

Bob Ainsworth: The review team looked at the National Audit Office findings, and there is comment on that. Of course there is potential in some areas to make savings, if not on the properties themselves, then on the overheads for things that are underutilised. However, there is a need for investment, so we have to try to see to it that the reconfiguration gets due priority in our planning rounds in future. We also have to see to it that reserves get the funds that they need, so that they can have the estate that they need, so that they can get the training that they need to be effective.

Protection of Children (Publicity)

Jacqui Lait: I beg to move,
	That leave be given to bring in a Bill to prevent the exploitation by parents of their children by means of seeking publicity, primarily for the purpose of financial gain, in respect of the actions of such children; and for connected purposes.
	It would be a rare adult who was not appalled to discover that a mother could plot with other members of her extended family to kidnap her daughter for financial gain, and I, for one, was relieved that the plot was discovered and the mother and her accomplice jailed. Not much later, the story broke of the alleged 13-year-old father, and we had to endure the spectacle of him, the baby, the mother and other claimants to fatherhood all over the world's media.
	I ought to declare an interest as my husband is leader of East Sussex county council, which was involved in that case. Senior officers in the council have done much devilling work for me and I am grateful to them for their help and advice, as I am to the Clerks and the Library of the House. I am also grateful to my hon. Friends the Members for Eastbourne (Mr. Waterson) and for Wealden (Charles Hendry), among others, for sponsoring the Bill, and I hope they do not think I am treading on their toes. I regard this as potentially a nationwide issue.
	I also alerted the Under-Secretary of State for Justice, the hon. Member for Dewsbury (Mr. Malik) to the fact that I was planning this Bill. I quite understand that, as a Minister in the Ministry of Justice, he cannot be involved, but I hope he hears my argument and acts on it. I am also hugely grateful to the Centre for Social Justice for its analytical work, which has opened up the whole debate on the impact of family breakdown on society
	Those two cases had in common the misguided desire of a self-interested adult member of a dysfunctional family to profit by exposing their child to a media storm. I shall not refer any more to the details of those cases as those involved have had the protection of the law to regain their anonymity. What alarmed me about them was the damage that would inevitably be caused to the youngsters who were exposed to the full glare of publicity.
	I want to emphasise that this is not a routine attack on the media. I used to be in that business, and when I was I would have given my eye teeth to be in on such a story. Luckily, however, I have not had to face the media pack in full cry and I hope I never have to, but I have heard about the horrors of it from adults who have had to endure it, whether for good or for bad reasons. For vulnerable children to be exposed to it is appalling. To have lots of strangers doorstepping them, asking for comments and interviews, shouting at them, having flashing cameras pointed at them and being followed by the press pack must have been a nightmare, and I commend the relevant authorities for acting as quickly as they could within the ponderous processes of the law to protect the youngsters in a way that any normal person would expect the parents to do.
	What concerns me more than anything else is that the parents could even dream that they could make money from their own vulnerable children. This is a new extension of the many abuses that children have suffered over the years and which we have tried to address. We have spent many hours in the House and much printers' ink in trying to come up with foolproof systems of protection for children from physical abuse, and I am fairly certain that we have not succeeded yet.
	Such abuse by the media is an extension of the abuses to which children are already subjected. I do not want to see other adults thinking that there may be some financial gain to be had by doing this. I want to stop a terrible trend of abuse that could be emerging, and I want to stop it before it can take hold. In this simple Bill, therefore, I want to put in place a measure of protection for any other children who may become the victims of their parents.
	We all know of dysfunctional families from our constituency casework. I doubt that there is a single Member who has not met in their constituency large, extended and informal families: some work as families, many do not. We are probably all aware of the impact on families of lack of work and benefit dependency, debt and financial challenges, drug or alcohol addiction, mental health problems, poor neighbourhoods and poor parenting skills. I have not designed the Bill to sort out those fundamental problems; that will take a Parliament of legislation and work on the ground across many years and many generations. It is not a Bill to control the media, and I do not want it to stop child prodigies and their parents benefiting from their achievements in music, maths, dance, sport or whatever they excel at—good luck to them. We will need them to do well in the Olympics and to get us out of our current economic mess.
	My Bill simply puts back on parents the responsibility not to exploit their vulnerable children by amending the Children and Young Persons Act 1933, so that anybody who has responsibility for any child or young person and causes the publication of any information in respect of the child, including photographs or digital images, that is likely to cause significant harm to the child should be guilty of an offence and liable on summary conviction to a fine and/or imprisonment of up to two years. I define a child or young person as someone under 18 years old. I also include in significant harm both physical and psychological harm.
	We protect our children in the family courts from publicity, notwithstanding the changes that were brought in yesterday. We also protect those involved in the youth justice system, however horrible the crime they may have committed. Most young people in trying circumstances are already protected from media exposure, and none of us probably expected or envisaged that this horrible loophole would emerge, whereby parents intentionally try to make money out of their children in ways that would harm them. I doubt that in 1933, when the Act to protect young people was drawn up, anybody thought that we would need to extend it to stop parents exploiting and abusing their children for the money that they could make from publicity. It is a sad indictment of our society that, some 70 years later, we need to introduce such an amendment.
	It is our responsibility as legislators to ensure that our young children are able to grow up as normally as possible, but that, as we all know, is quite a stretch, given the record of family breakdown and dysfunctionality throughout the UK. The wider challenge is to help to heal those wounds, but that is well beyond the scope of the Bill. This Bill is a small Bill; it is a one-paragraph Bill, but it could prevent more abuse of young and vulnerable children by their parents. I commend it to the House.
	 Question put and agreed to.
	 Ordered,
	That Mrs. Jacqui Lait, Charles Hendry, Mr. Nigel Waterson, Mr. Iain Duncan Smith, Mrs. Maria Miller and Tim Loughton present the Bill.
	Mrs. Jacqui Lait accordingly presented the Bill.
	 Bill read the First time; to be read a Second time on Friday 26 June and to be printed (Bill 88).

James Purnell: This debate should not be about statistics but about people. I am sure that statistics will be bandied around, but we are talking about real people who are worried if they have lost their job and worried about how to support their children, and workers worrying if they might be next. The welfare state is here precisely to support people at times such as this. We have strengthened the safety net so that we pay people's mortgages if they cannot get back into work, we pay their pensions if their company goes bust and—thanks to tax credits, which the Conservatives have said they want to dismantle—we are paying more than 300,000 people an extra £35 a week to soften the blow of losing overtime or work.

James Purnell: That is exactly what has happened in my Department—we have reduced back office jobs by 30,000 to 100,000. The right hon. Member for Maidenhead (Mrs. May) opposed that because she wants to present easy arguments about— [Interruption.] She says no. She goes around talking about 750 jobcentre closures. That was a result of putting together the Employment Service and the Benefits Agency, thereby improving the service, reducing the time that we take to process benefits and improving the advice that we give people to get them back into work. They now get back into work far quicker than in the past, yet the right hon. Lady opposed that. Conservative Members have no idea how to make the system more efficient—they are simply ideologically committed to cutting spending.

Christopher Fraser: Does the right hon. Gentleman accept that as a result of the inability to secure much needed investment, many small firms are cutting back on staff, placing even more people in unemployment?

James Purnell: Actually, because of the tax deferral policy that we have put in place, £2 billion has been deferred. That is helping 100,000 companies and more than 600,000 people. Because of the policies that we are putting in place overall, we think that 500,000 people are having their jobs protected. Because the hon. Gentleman's party is against that extra help, the consequences under his policy would be far worse.  [ Interruption. ] Again and again, the Opposition want to say that they will cut spending, but they do not want to live up to the consequences of that, which would be less help now.
	The next stage of the extra spending is what we have announced today, which is a future jobs fund, which responds to the point that my right hon. Friend the Member for Birkenhead (Mr. Field) made about what we do if there are not enough jobs. What happened in the '80s and '90s, when there were not enough jobs for young people, was that they were simply abandoned and left on the scrap heap. Many right hon. and hon. Members will have seen the consequences in their constituencies. They will know that often those people never got back into work again and that often their children never got into work when they grew up. That was the root of many of our welfare problems, which we have been starting to put right.

James Purnell: We actually announced £600 million extra in the Budget—again, money that the hon. Lady's party would not be able to provide. And, of course, the shadow Chief Secretary to the Treasury will note yet another spending demand from those on his Back Benches.

Charles Walker: This is absolute rubbish. I know that Damian McBride has left No. 10, but please could it get a new speechwriter so that it does not waste everyone's time with this utter drivel.

James Purnell: I have said that I will not give way to the hon. Lady, so perhaps she will let me make progress.
	But we can and must aim to do better than in previous recessions, and that is why this extra money is so important. As a result of this extra money, we will be able to pay benefits on time; even though more people will be claiming, we aim to reduce the amount of time taken compared with previous years and to meet our target this year. The right hon. Member for Maidenhead would not be able to make that promise.
	Because we have reformed Jobcentre Plus we have almost halved the average time that it takes people to get back into work compared with previous recessions, because of this money we can aim to continue to do better than in previous recessions, and because of the way that we have reformed the welfare state we are not seeing the big increases in the numbers claiming other benefits, as happened in the past.

James Purnell: Actually, our figure was right at the bottom of the international scale; it was lower than that of the United States. The amount of people on disability benefits and unemployment benefits in this country is lower than international levels. Of course we want to do more to reduce it, and we have a policy precisely to do that—a policy that the right hon. Lady's new colleague, David Freud, said was remarkable. I am sure that she shares the view that our record is remarkable.  [Interruption.] She will know that people who were around in the 1990s remember that people were told to go on to incapacity benefit; the numbers were massaged and all the Conservatives cared about was getting the numbers on the unemployment register down. The problem was that when people were put on IB they were never offered any help to get off it, and that is exactly why the number of people on IB trebled under her Government.
	We cannot be immune from what is happening, but we can aim to do better than in previous recessions, and we will aim to do so on three key tests: maintaining the active labour market regime and paying people's benefits on time; getting people back into work more quickly than in the past; and ensuring that there are not the sharp increases in the number claiming inactive benefits that happened in the past.

Steve Webb: The Secretary of State rightly points out the waste when young people become long-term unemployed. Acting after a year is clearly better than nothing, but does he accept that for a 19-year-old a year is an eternity? Is it not apparent on day one of unemployment who the groups with a high risk of not getting back to work quickly are? Could there not be targeted intervention on day one, for example, to help young people who have no skills or poor literacy, rather than a wait of a year?

James Purnell: I am grateful for the hon. Gentleman's question because it gives me the chance to put right a misunderstanding. We do not wait for a year; we give help to people even when the redundancy is announced. We give them help from day one. We do exactly what he says: we fast-track people on to the flexible new deal, and then at six months we provide the extra support in terms of giving people help to set up a company or providing the golden hello of up to £2,500. The extra guarantee is that we will say to everybody that within a year they will be offered a job or a training place. Already, more than 80 per cent. of people get back into work within a year, but this is a new guarantee that everybody will be offered a job or a training place— [ Interruption. ] We are not wasting a year: we offer people help and training from day one. We have access to the advisory discretionary fund from day one, and we help them with CVs from day one. We refer them to jobs clubs early in their— [ Interruption. ] It does work, because it gets people back into work more quickly than in previous recessions, but in addition we are introducing a guarantee that within a year everybody will be offered a job or training place, and that has been widely welcomed outside the House as well as within it.
	It is extraordinary that the Conservatives still have not said that they would match our spending on unemployment. I paid close attention to the Conservatives' party conference at the weekend and they were able to commit to spending extra money on certain things. They say that they want an age of austerity. It is a strange sort of austerity when they will not commit to spending a single penny more on the unemployed, but will commit to spending billions of pounds on those in jobs earning over £150,000 a year. It is a strange sort of austerity when they cannot commit to help young people at all, but they can promise a tax giveaway of £200,000 to the 3,000 richest estates in the country. The Conservatives' priority is clear—no more money for the unemployed, but £200,000 for the 3,000 richest estates.

Theresa May: The Secretary of State says that it is all right, because it will take six months, rather than nine months, for help to come in. That is still rather different from saying that there is real help now. Virtually every announcement that the Government have made about the help that they are giving to businesses, home owners and unemployed people has taken months to bring in.
	The Secretary of State made some statements in his speech about our considering the impact that this situation has on people. He is absolutely right. When we are debating in this House, we must never forget that while we might talk about the figures, behind those figures lie shattered lives for many people. It is crueller, however, to say to people that they will get help now and then to delay that help. If the home owner mortgage support scheme had come into place when the Government announced it, 28,000 homes might not have been repossessed. That is the impact on people's lives.
	If the Secretary of State had not been so complacent earlier about rising unemployment, perhaps we would have seen that help coming through earlier. If he had been honest with himself about the level of worklessness, perhaps he would not have had to make plans last November to cut the new deal across half the country this summer. Indeed, if the Government had taken action when unemployment started to rise more than a year ago— [ Interruption. ] I will talk about job centres, as the Secretary of State did. The point that I am making, which I shall continue to make, is very simple. The Government continued to close jobcentres when unemployment started to rise. If the Secretary of State had taken action when unemployment started to rise, 54 more jobcentres would be open to help deal with the increased number of benefit claimants who need support and help to get back into work.

Theresa May: What I am happy to tell the right hon. Gentleman is that when we come into government, we shall ensure that there is extra money available to help the unemployed, because we shall put through the welfare reform proposals that the Secretary of State has tried to copy but has been extremely timid about. They would mean that money can be used to pay for programmes to get people into work at a rather quicker rate than he would do under his welfare reform proposals.  [ Interruption. ] From a sedentary position, the Secretary of State says, "Oh, well you're going to be spending more." He is well aware that there is a fundamental difference between our welfare reform proposals and his proposals. He does not like to talk about it, which is why I said he was timid: the switch in the DWP budget that enables us to pay for programmes to help get people into work from the benefits that can be saved will be made across the whole country, whereas under his proposals it would be done merely across half the country, which would mean that half the country will not actually benefit from his welfare reform proposals. In one part of his speech, he said that our policies would abandon people to a lifetime on benefits. In that case why has he copied them?

Theresa May: I would like to make a little more progress. The hon. Gentleman may well get in later on, but I have been generous in giving way to Ministers.
	I want in particular to discuss further the impact of the proposals in the so-called "Budget for jobs" on the young long-term unemployed. As I was saying before the exchanges across the Dispatch Boxes, under-25s who were long-term unemployed could previously be helped after six months; now, that period has now been extended to 12 months. That is not an improvement to the support given.
	There is another problem in the Budget figures. The Red Book makes it absolutely clear that the guaranteed jobs or training will be available to 18 to 24-year-olds who have been on jobseeker's allowance for more than one year. Their number stands at 6,700, out of a claimant count of 1.46 million. In other words, the Government's plans would help less than 1 per cent. of jobseekers. I notice that the Secretary of State is not rising to say that I am wrong about those figures.

Theresa May: Had we been on the Government Benches, the situation that we would have been dealing with, in relation to the finances of this country, would have been rather different. The reason why the Chancellor of the Exchequer found it so difficult to do anything about the matter when he stood at the Dispatch Box was that 12 years of a Labour Government has led us to the deepest recession since the second world war and to the largest Government borrowing over two years seen in peacetime history. The hon. Member for Northavon should note that what we are talking about is the reason why the Labour Government were unable to provide that help in the Budget.
	I am conscious of the time, but I want to talk briefly about pensioners, because they, too, are potentially hit in the Budget. Pensioners and savers are the innocent victims of the recession. That is why we called on the Government to introduce tax changes that would deliver help and support for basic-rate taxpayers and pensioners. Sadly, however, the Government do not understand the value of saving, as all that they have ever done is spend, spend. The savings ratio has been slashed to a almost five times lower than what it was in 1997; more than 12.8 million jobs have no pension provision—800,000 more than last year, and 2.4 million more than 1997. I accept that there were measures such as the increased individual savings account limits and the rise in the capital disregard for pension credit, housing benefit and council tax benefit in the Budget last year, but our proposals for the Budget and the change in savings would have put about £3 billion a year back into the pockets of pensioners and savers. The announcements in the Budget are worth only £90 million a year to savers and pensioners.

Theresa May: I would dearly love to be able to welcome a forecast in the Budget, and I dearly hope that the savings ratio will increase. However, at the rate that the Chancellor is going, I do not think that any of the forecasts that he has included in the Budget are to welcomed, because I do not think that we can believe any of them.
	I want to refer briefly to the tax rise on pensions. I am afraid that the Budget was more about politics than about presenting a plan for economic recovery. There is a sense of déj vu. One of Gordon Brown's first acts as Chancellor was to raid £100 billion from pension funds, and now as Prime Minister, his latest tax hike in relation to the higher-rate relief on pension contributions will take a further £3 billion a year out of pensions. Those changes are not being implemented from 2011, as the Government would have people believe—some new rules on higher-rate tax relief for earnings above £150,000 came into effect the day after the Budget. Not only do they taper higher-rate tax relief for those earning over £150,000 but they tax employer contributions. Savings, of course, will be taxed when people begin to draw their pensions. Those proposals break the basic covenant between savers and the Government, enshrined in the Turner report on pensions, that responsible savers will be rewarded for locking up income in pensions savings for their retirement. Instead of being rewarded, however, they will be taxed several times over. The changes will add more complications to an over-complicated system, too. Any claims that the Government want to simplify pension savings and their administration have been completely undermined by what the Chancellor did in the Budget.
	The Chancellor said that the measure was about fairness, but the money raised in taxes from the pensions of high earners will not go towards improving pensions for those on low incomes. It will simply help to plug the black hole in finances created by Labour. In the words of Dr. Ros Altmann, who said in her response to the Budget:
	"Instead of encouraging people to save while the economy was doing well, Government policy encouraged spending and borrowing as if there was no tomorrow. But there is a tomorrow. And for those approaching retirement, it is looking distinctly bleak."
	Let us be clear: we do not believe that increasing taxes on pensions is the right thing to do. We do not support it, but we are not going to be dragged into playing Labour's games. There are a number of new tax rises with which we do not agree, but this one will have to take its place in the queue. Our priority is that of all of Gordon Brown's tax rises, the most important ones—

Theresa May: I apologise to the House and to you, Mr. Deputy Speaker.
	Our priority is that of all the Prime Minister's tax rises, the most important ones to avoid are those that tax the many, not the few. The most unfair of those is the national insurance increase for millions of people earning £20,000 or more—a tax on jobs. At the very time that Britain will be trying to recover from recession, when millions of unemployed want to get back into work, Labour wants to raise a tax on jobs. We will ignore the dog-whistle politics that was presented in last week's Budget, and focus on avoiding Labour's tax cuts for the many, not the few.
	This country needs a Government who will be honest with people about the problems we face and the mess that we are in. We desperately need a realistic route map to recovery, instead of the fantasy forecasts from the Government that do not last even a day. I shall be helpful to the Secretary of State and suggest that the best thing he can do now is launch the leadership campaign that he has been busy planning for months and call a general election, so that Britain can have the change that it desperately needs.

Peter Hain: What was striking about the speech from the right hon. Member for Maidenhead (Mrs. May) was that it was devoid of any content on the policy alternative she might advocate. The policies advocated so effectively by my right hon. Friend the Secretary of State would be unaffordable and undeliverable if Conservative policy cuts were implemented. I shall explain why.
	The economy is contracting faster than the Treasury expected only five months ago, so the Chancellor was right in the Budget to give a further fiscal stimulus, expanding the one announced in November. It brought total fiscal support through discretionary action in the Budget, the pre-Budget report and the automatic stabilisers to 4 per cent. of GDP, on top of the other action to boost the flow of credit and cut interest rates. Goodness knows where the economy might be heading now if the Government had instead followed Conservative strictures, and had not acted promptly to adopt a Keynesian response to the crisis.
	The Budget also did the right thing by boosting public investment this year to £44 billion, compared with the £35 billion the Chancellor was planning to spend 12 months ago. These are exactly the right policies and priorities to stop a slide into slump, and exactly the right strategy to ensure that the recession is not deeper and longer.
	Conservatives seem to forget that the purpose of extra public borrowing is to make up for the collapse in private spending brought about by the global financial crisis. By helping families who are in danger of losing their homes and their livelihoods, and by helping firms that cannot spend because their banks will no longer lend, Government can stop economic casualties turning into social catastrophes. Without such Government action and borrowing, millions more jobs, and tens of thousands more businesses, would be in jeopardy.
	Borrowing is rising because of the impact on UK public finances of the world economic crisis, not the so-called public spending extravagance beloved of the leader of the Conservative party and his right wing media allies. The Institute for Fiscal Studies reckons that the global financial crisis is costing the Exchequer around £90 billion per year, owing to lost tax revenues and higher social security costs. The fiscal stimulus since last year's Budget accounts for only about £26 billion of the nearly £400 billion increase in Government debt to 2012, or roughly one fifteenth of that total.
	No one here or elsewhere in the world foresaw the severity of the crisis currently gripping the global economy. Perhaps that is why, after 15 years of expanding UK employment, and Labour's 11 years of unprecedented stability and growth, much of the media appears both bewitched and bewildered by the prospects for Government borrowing and national debt. In one surreal moment last week I heard the Chancellor on the BBC "Today" programme being asked by Evan Davis about Government borrowing for the Budget, not last week or even next year, but in 2014.
	Even more preposterous is media speculation about borrowing and debt in 25 years' time, when the average Budget forecasting error is £12 billion for net public borrowing looking just one year ahead. Many commentators have become spellbound by long-term forecasts of public sector borrowing, and are quite unable to focus on the benefits that such borrowing brings, or to contemplate the truly horrendous alternative without it.

Stephen Hammond: I have been listening carefully to the hon. Gentleman's arguments about forecasting errors. That implies that the Treasury's forecasting is so bad that we should not take any notice of it.

Peter Hain: The hon. Gentleman will know that if he looks at Treasury forecasts under all Governments, there is always an element of error. The point that I was making is that the amount is much more significant than all the figures being flung about by the Conservatives and their media allies.

Peter Hain: Given that, like others, I am time-limited, I shall make some more progress.
	It was only a few years ago that Britain finally finished paying off its 1947 American loan that helped to pay for post-war reconstruction. It took us more than 50 years to do so. Does anyone seriously say that we should not have borrowed on a substantial scale to rebuild the nation's social fabric shattered by the war? Perhaps there are some Conservatives and media commentators who sympathise with Johnny Speight's character Alf Garnett, who criticised Winston Churchill for failing to get an estimate of the costs before fighting the second world war.
	As with mortgages for owner-occupied housing, good investments are things that are worth more than they cost to acquire at the time. Who can seriously argue that Governments who borrow to prevent a depression are making a bad investment, as the Conservatives appear to be saying? They have failed to learn the grim lesson of the 1930s that cutting Government spending during a recession only makes the economic situation worse, causing total spending in the economy to fall even further, resulting in more redundancies, higher social security spending and even higher Government borrowing and debt. Spending cuts in today's circumstances would be a self-inflicted wound that would weaken, not strengthen, our ability to recover. They could turn business parks into gone-out-of-business parks and trading estates into ceased-trading estates.
	By contrast, we see higher public spending and increased Government borrowing to ward off recession as the right role of the state now. In our view, Government's job is to provide a safety net in troubled times, support and opportunity for the good times, and security and protection at all times, not to leave people in the lurch to fend for themselves, which the Conservatives would do. Of course the economy needs to be brought back into balance in the future. But the overriding priority today is not Government debt. It is the danger of depression and rising unemployment. The bond market must take second place to the labour market.

Peter Hain: Tackling the threat of slump, which means combining vigorous fiscal and monetary policy with unconventional measures to restore the flow of credit, is vital to recovery. But, of course, once we have warded off the threat of recession or depression there is no escaping our responsibility to bring the public finances back into shape in the medium term, as the Chancellor has made clear. That must mean reshaping the subsequent trajectory of Government spending and taxation, which means cuts in some past plans, deferring other ambitions and raising some taxes on a fair basis. But today's problems must come first.
	The severity of the current threat to the world economy remains widely unacknowledged, despite the evidence of world trade falling faster than it did at the onset of the 1930s great depression, and despite industrial production plunging all over the world, including in the UK. There is reluctance on the Conservative Benches to admit that this recession is different from every other post-war recession, both in its origins and in its scale. [Hon. Members: "It is worse."] Indeed, and it is much more serious because of the global financial crisis that the Conservatives refuse to acknowledge. There is a refusal to accept that we are passing through extraordinary times that demand an extraordinary response, with action on a scale unprecedented in the post-war period.
	It was Franklin Roosevelt's new deal public works projects, combined with bank reforms and monetary measures, and not cuts, that first triggered the American turnaround that began in 1933, and then fuelled expansion over the next four years.
	I have been impressed by the advice given by that lone voice on the Bank of England Monetary Policy Committee, David Blanchflower. He was the first to warn of the danger of recession and the first to call for early interest rate cuts. He has proved consistently correct in his reading of the economy. His most recent warning is that, without strong fiscal action, precisely of the kind that the Chancellor announced last week, today's downturn could fall further and last longer than any recent recession, causing UK unemployment to soar towards 4 million next year, potentially condemning a generation of Britain's young workers to years on the dole.
	The Conservative party has an obligation to be straight with voters and with the House. The shadow Business Secretary can ooze warm reassurance with the best of them, but one has only to look at the shadow Chancellor to see that it is only a short way from guile to guilt. The Leader of the Opposition described the Government's record as being written in red ink. When will he show us the colour of his party's money? So far, all the public have been offered is counterfeit currency. The Conservatives have pledged to prioritise cutting Government debt ahead of tax cuts and to restrain Government spending, but the Opposition will not come clean about the huge cuts that would be needed if they were to achieve their ambitions. They have given headline-grabbing examples such as regional assembly abolition and senior public servant pay restraint, but those savings would barely register on the spending Richter scale. More ominously, they propose cutting tax credits for middle-income families and the pay of nurses and teachers. Those people are at the economy's centre of gravity: squeeze them and we squeeze the whole economy, as well as damaging vital public services.

Philip Hammond: I am listening carefully to the right hon. Gentleman. He knows that the figures that the Chancellor set out in his Budget last week, after taking into account the increases in benefits and debt service costs, equate to a minus 2.3 per cent. rate of growth in departmental expenditure budgets—a 2.3 per cent. real terms cut in departmental expenditure budgets. The right hon. Member for Neath (Mr. Hain) may have an inside track, however, so does he know where the Government will allocate those unprecedented cuts in departmental budgets?

Ian Gibson: The hon. Gentleman is painting a gloomy picture, but there are rays of sunshine, are there not? In the insurance industry, for example, he will have seen that Aviva, the parent company of Norwich Union, is boasting that people trust its products and have stuck with them; indeed, savings have increased, and its figures look good at this point. We can be miserable and say that we do not know how things will improve, but that is happening in certain places. Because of good management and good structures, even a Footsie company such as Aviva can survive.

Vincent Cable: That sounds like a very good story, but it does not have anything to do with the revival of economic growth, which is what we are discussing.
	There are some positive things in the public sector figures; following the hon. Gentleman's theme, I will be positive, as perhaps I have been too negative. One very positive statistic, which the Government have not made enough of, is that this year the share of taxation in GDP has fallen to the lowest level for half a century. I do not know whether the Government are aware of this, but they have achieved something that Mrs. Thatcher would have given her right arm for. They have cut the tax burden on the economy to an extraordinarily low level: that may not have been planned for, but it is a real achievement. However, there are two stings in the tail. First, while the tax burden in the economy has been dramatically cut, expenditure has not. Whereas the tax burden is at the lowest level since 1960, when Harold Macmillan was Prime Minister, expenditure as a share of the economy is now 48 per cent., as opposed to 35 per cent. for tax. That is the highest level since the Falklands war, when we previously had a peak in this respect. Clearly, we will have a symbolic breakthrough when we hit 50 per cent. of GDP as expenditure in the next year or so.
	The other major explanation for this is that it has not been done in a planned way, and it has happened simply because of the collapse in Government revenue. However, I would say in the Government's defence that this is a long-standing problem; it did not just happen over the past 10 years. We have an economy that has, over the past quarter of a century, become seriously over-dependent on income from the City of London and from the housing market. Over the past five years, when some of us have been warning about the vulnerability of the British economy, the Government relied on those two sources alone for half of all the increase in their revenue. Of course, they have now evaporated.

Vincent Cable: I do not deny the right hon. Gentleman's argument. Indeed, he and I have tabled a motion on the Order Paper today, expressing his anxieties and saying that we must rise to the challenge.
	In conclusion, I want to refer to the process whereby we pursue matters, as opposed to substance and specific items. In the past, we have said that there needs to be an advance in the discussion of Government budgets and fiscal policy, comparable to that which made the Bank of England independent. For 20 years, Governments in this country and elsewhere struggled with inflation and having an inflation anchor. The concept of independent central banks has been implemented and will be important in the UK as the economy recovers and we get back to inflation. We have nothing comparable for fiscal policy apart from the rules, which have been widely disregarded. Part of the answer, as the Liberal Democrats argued five years ago, is an Ofsted-type system, which has oversight of fiscal rules and their implementation. The Conservatives have devised a variant of that, which is interesting in its slightly different way. However, the House is missing in all that.
	It is striking that we will move from the debate to weeks of intensive discussion of tax proposals in infinite detail, but, apart from the Public Accounts Committee, which the hon. Member for Gainsborough (Mr. Leigh) chairs, there is no systematic discussion in the House of public spending, unless it happens retrospectively. We must introduce a process whereby hon. Members hold a mature debate on the subject and preferably approve or disapprove public expenditure. That is currently missing. It is partly a question of debating points and identifying the items, but we must all recognise that we have a responsibility here to start focusing on that debate, which is currently non-existent.

Edward Leigh: The hon. Gentleman knows perfectly well that I was not talking about income tax at all; I was talking about efficiency gains. If he is going to intervene, he should at least intervene on a subject that I am talking about in my speech.
	I want to turn to the aspirations of the operational efficiency programme, which I welcome. It is a laudable proposal, but will it actually be achieved? The right hon. Member for Neath (Mr. Hain) tried to paint a picture of an incoming Conservative Government cutting vital services. Let me give the House some suggestions of savings that we might make that would not impact on ordinary people. For instance, why is the civil service pay bill running at 1.4 per cent. ahead of that of the private sector? Can we not cut out unnecessary machinery of government changes? The divorce of the Home Office and the Justice Department was very costly, like all divorces. Was it really necessary?
	What about the army of consultants? There are five times more consultants per employee in the public sector than there are in the private sector. That is £10,000 for each civil servant who has a consultant. Do we need them all? Do we need the vast variation in the cost of office accommodation? I have asked before why the Treasury is the most expensive Department in terms of office accommodation. Why can we redeploy only 24,000 civil servants from central London? Could we not get rid of more assets? It is true that the Government got rid of £1.5 billion of assets last year, but they acquired many more. Funnily enough, among those few things that I have been talking about for the past minute or so, I have identified £5 billion worth of savings, none of which would have any impact whatever on front-line services.
	I want to put some serious questions to the Ministers about the detailed and important announcements that have been made. Will the value for money review group have the authority to make really tough choices? Will the Ministers' champions for money be able to say no to spending beyond their immediate control? Will the non-executive directors that we have been hearing about be able to stop wasteful spending when they see it? Will the public value programme have real targets, expressed in pound signs, and will it go far enough and fast enough? Those are a few questions for Ministers. If those detailed questions on efficiency savings and other matters cannot be answered in clear terms, we might be talking about a sticking plaster to deal with the black hole, rather than a real attempt to fill it.
	I say to my hon. Friends on the Front Bench that if and, I hope, when we come to power next spring, they will be faced by the "Yes, Minster" syndrome. We all know that the mandarins will say, "Minister, what you are proposing is administratively impossible, legally inadmissible, financially unjustifiable and politically unacceptable." Anyone in the Chamber who has been a Minister will know that those are precisely the answers that the civil servants will give. We shall have to slay those shibboleths; we shall need to be very tough indeed.
	The crisis is upon us. The hon. Member for Twickenham made that point very well, as did my right hon. Friend the Member for Maidenhead (Mrs. May). In the five short months since the pre-Budget report, the public sector borrowing requirement has increased by a staggering £280 billion—more than half as much again as the Chancellor's November forecast. As my right hon. Friend said, that is £22,000 for every baby now being born. My sister-in-law came in when we were having a family lunch last weekend and said, "Great news! We're going to have a baby." That new baby will have £22,000 of debt when he or she arrives in the world.
	This is a real crisis. It is much more serious than party political banter. The fact is that the era of imperial spending is over, as is the era of sofa government, of back-of-the-envelope, of Tony Blair committing himself to a new national computer or whatever. That is all finished; it is over. There are such difficult decisions that we now have to make, not only about the NHS computer. Yesterday, the PAC was looking at the third sector, which has not been debated in the House this week. There has been a complete lack of accountability, with £500 million perhaps wasted. We are also considering the Chinook helicopter, GP and consultant contracts, the Olympics, the farce of the Rural Payments Agency and the farce of the Department for Transport's shared services. There has been so much wasteful spending.
	Describing the Budget, the London  Evening Standard put it well:
	"It will surely be nowhere near enough to rescue the public finances. It is hard to see how further cuts are now unavoidable. Some cuts seem obvious: scrapping ID cards, for instance, and freezing plans for colossally expensive government IT upgrades. And there are far more cuts that could be made: a succession of reports from the Commons Public Accounts Committee has identified enormous waste in the public sector. Even then, further tax rises seem likely too."
	This matter is just too important for the kind of intervention made by the hon. Member for Edmonton (Mr. Love). We are talking about a real crisis, real cuts in services and, probably, real tax rises.

Edward Leigh: Members of the PAC are very proud of the fact that it is not partisan and that 90 per cent. of our recommendations are accepted by the Government, but the hit rate on delivery is not so great. As the whole Budget process has been mentioned, may I say that it is fantastically weak? When the President of the United States proposes a budget, Congress disposes. Our Budget process is one of the weakest in the world, so last year I proposed having a proper Budget committee. As the hon. Member for Twickenham was saying, we have to address these problems seriously. The Finance Bill will now go into Committee, where hundreds of amendments will be tabled but not one passed, where there will be no proper debate and where an average of a few seconds' consideration will be given to each amendment. That is not good enough for this democratic Chamber. When we are talking about a crisis on this scale, can we not have a proper Budget process whereby we debate these things properly?
	I wish to make one point about how we are going to deal with the national health service and education. I firmly believe that spending on the NHS has to run above inflation to a certain extent, because of an aging population and the ever-increasing cost of providing reasonable health care, but we must have firm cash limits and we have to trust professionals—the days of targets and of not trusting doctors must be over. This debate will not be reported; all of tomorrow's papers will be talking about swine flu. If that takes off, will anybody want to ask our opinion about it? Will they want to ask the opinion of NHS managers? No, they will want to ask the opinion of doctors; we have to trust professionals in the NHS and in education to deliver those essential services. We politicians constantly say how much we trust and admire professionals, but we constantly take decisions away from them in our schools and our hospitals—that is a debate for another place and another time.
	I am reaching the conclusion of what I wish to say. What we now need is political courage. We must face down fantasy and face up to the real fact of the crisis before us. We must restore Prudence to her proper place and marry her to true efficiency. We must have lean government and we must be more disciplined. Some programmes will not pass muster—some will have to be cut. We should echo President Obama, who said:
	"Where the answer is yes, we intend to move forward. Where the answer is no, programmes will end."
	So courage will count. Some services will have to be withdrawn and we should have the courage to admit it; a lean government will offer less to some, but it will offer more to those genuinely in need.
	Only the resolute, obsessive pursuit of lean government, line by line, programme by programme, will do. Out must go complexity and the farce of the tax credit errors. Out must go waste and Government computers delivering commands in German, as we saw in respect of transport shared services. Out must go the outright failure that has occurred in many programmes, such as the national offender management information system.
	Making government lean, on its own, is not enough. We must ask the following of any programme: does it matter? The "civil service year book" lists 526 central Government bodies—26 bodies are involved in tackling childhood obesity alone. Yesterday, in the Public Accounts Committee, we learned that in respect of the third sector alone 60 civil servants are employed in the Cabinet Office—this organisation that delivers fantastically bad value for money. Although it may not be fashionable, we have to return to stern Gladstonian politics. We need a properly accountable Budget process and we must balance the Budget.

Michael Meacher: There are many reasons why the banks are not lending as much as the Government would like, one of which is that they have been given something of a conflict between lending to businesses and, at the same time, building up their balance sheets. The lowering of our interest rate—at the start of the crisis it was 4.5 per cent., which was one of the highest figures in the western world, and it is now 0.5 per cent.—was necessary, but I accept that there have been some perverse effects of the layering of different policies. I wish to develop this argument a bit further. As Paul Krugman, the American winner of the Nobel prize for economics last October, has said, the credit crunch is so drastic and the consequences so cataclysmic that it can be rapidly overcome only by taking temporary control of the banks. To be fair to the Government, they have already partly done that. The key point is that with the strength of the state behind the banks, there would be no need for them to put their own interests first by consolidating their balance sheets as their first priority.
	The Government, as temporary owner—I accept that it should be temporary, but it should also be for as long as necessary—would then be in a position to restore lending to pre-September 2007 levels, which was always the Government's intention. The effect of that on the public finances would be dramatic. Instead of expending £1.2 trillion on propping up the banks, the Government could take them over at a fraction of the cost. The Government have spent £45 billion propping up the Royal Bank of Scotland, but they could have purchased it for £4 billion, which was its stock market value in January this year. Lloyds, which was valued at £35 billion a year ago, could have been bought on the stock market for just £6 billion last October. All of the major banks could have been taken over at a fraction of the cost.
	The Government are now offering mind-blowing sums of taxpayers' money to underwrite the banks' toxic assets—£325 billion in the case of RBS and £250 billion for Lloyds, and Barclays are standing in the wings with a few further hundred billion. But given that the Government are the owners, they should either sell off or junk assets that are next to worthless and then redirect the rest into lending in the wider economy that so desperately needs it. I know that that is a drastic approach, but in such times we must adopt such policies.
	That policy would transform the Budget prospects. The deficit a year ago was just £38 billion. By the time of the pre-Budget report in November, it had soared to £118 billion. It is now £175 billion, and unlikely to fall before reaching £200 billion. The interest charge on this debt was given in the Budget as currently £28 billion a year and the Chancellor expects it to rise to £43 billion a year. If the banks had not been bailed out so profligately and instead lending on a far greater scale had been pumped directly into the economy, thus sharply reducing the costs of business rundowns and rapidly rising unemployment, the rise in the national debt would be far more modest, and the rise in debt interest correspondingly far less.
	It is reasonable to estimate that on that basis the national debt this year might have been reduced by between £70 billion and £100 billion, and the interest on that debt might have come down to below £15 billion a year. That would dramatically change the Budget's bleak projections that investment spending must halve in the three years from 2011-12 and that total spending must be frozen over that period, with actual falls—as the hon. Member for Runnymede and Weybridge (Mr. Hammond) said—in real terms of more than 2 per cent. a year once fast-rising debt interest charges and sharply increasing unemployment costs are taken into account. The only way in which that could be avoided is by a review of policy along the lines that I have set out.

Jacqui Lait: I am not entirely certain whether the hon. Gentleman is living in cloud cuckoo land or never never land. If credit is not flowing, businesses will not be creating jobs and we shall not see an increase in employment. With the greatest respect, I suggest that until credit is flowing through the system again and businesses in constituencies such as mine in Beckenham start to take on employees again, we will not get the economy going again.
	The economy will not get going until the Government address the whole issue of borrowing. One of my concerns for the long term is their issuance of gilts. There is already resistance to gilt sales. The only way to sell the volume of gilts that the Government will have to produce will be to increase interest rates. The impact of increased interest rates will be an increased need to sell gilts, which means that borrowing will go up—as indeed will inflation, as night follows day. There is no recognition of that by those on the Treasury Bench, nor of the fact that if the issuance of gilts is resisted, the UK's credit rating will go down and the Government will be issuing their own junk bonds—their own toxic debt.
	The Budget did nothing to reduce the impact of public debt, apart from an attack on higher earners. We are all agreed that when we open the books, there will be more important things to do than dealing immediately with people who earn larger sums of money. It is unbelievably unfair of the Government to slap a national insurance increase on to the ordinary worker—the person earning £20,000 a year, which these days is not even the average wage. Relieving those people of such levels of taxation is much more important than dealing with anything else.
	Ordinary people in my constituency will not just be hit by national insurance contributions. They are already complaining about the increase in fuel duty, for instance. Unusually, I have received a series of original complaints about the recent 2p per litre hike in the price of petrol. June Skeet, a pensioner, has written to complain. Natasha Osunde, who works on commission and needs her car, has written to complain. Peter Allchin, who is disabled, has written to complain. The new fuel increases will have a huge impact on people who are just trying to get by.
	Pensioners are already under huge pressure from the reduction in interest rates and in their savings income. Businesses are complaining about the impact of the VAT cut; not only has it not increased sales, its implementation has cost them large amounts.
	I am sure that some people in Beckenham will welcome the car scrappage scheme. If it helps the car market, I do not have a problem with it—my car dealers are probably delighted—but I have a rather cynical view about what will happen to all the cars that are to be scrapped. Will they go into the scrap market, thereby reducing the value of scrap metal? Will they take over the fields that are to be freed up by the sale of the new cars coming on to the market? Will they be exported to developing countries and will there be an even bigger scandal because we have exported our old, polluting cars? There are large opportunities in the car scrappage scheme for scams and fiddles.
	A point that has not yet arisen in the debate is the impact on the retail sector of the various increases in business rates. There will be a 30 per cent. Government-imposed increase for the retail sector. There will be a revaluation of commercial property based on 2008 figures, at the height of the property boom. We have already seen the effect of empty property rates and now local authorities could levy a business rate supplement to provide infrastructure.
	People in Beckenham are complaining about the continuing impact on the whole British social scene of the increase in beer prices and its effect on the profitability of pubs. We have talked briefly today about the incompetence of the Learning and Skills Council and the lack of further education and sixth-form funding. That will have a long-term impact on the recovery of the economy.
	Time and again, we see incompetence from this failing Government. It is a long time since we have seen such incompetence. We have seen a real decline in their will to govern. It is time they recognised that they have lost the will and it is time for them to go.

Nigel Dodds: I am grateful for the hon. Gentleman's contribution, and I understand what he is saying; effectively, his point is that if we want to make a real difference, we have to go much further. I remember a previous debate in the House in which the Liberal Democrat spokesman, the hon. Member for Twickenham (Dr. Cable), made the point that the Americans' fiscal stimulus was on a much greater scale, and that it would require something of that magnitude to make a difference. Nevertheless, I believe that it is better to try to inject some kind of fiscal stimulus in the current situation than to go the other way. The approach adopted in the Irish Republic illustrates how painful the alternative is.
	I hold the position of Minister of Finance and Personnel in the Executive, and the fact is that there is a certain amount that the Executive and the Assembly can do locally to try to help the people of Northern Ireland—businesses, communities and hard-working families—through the current challenges and difficulties. We have taken measures to try to do that, such as freezing the small business rates in real terms as of 1 April this year, and introducing the small business rate relief scheme from April next year. We are also bringing forward procurement spend for major capital infrastructure projects in Northern Ireland. We are ensuring that as much of that as possible is spent as quickly as possible. We are introducing the speedier payment of Government invoices, so that money goes out to businesses and firms that are trading with the Government as quickly as possible. There are also reforms to the Planning Service.
	We could go further. Our party has suggested that there is a need to look at the issue of government infrastructure, and how much money we are spending on the machinery of government. A number of Members today referred to suggestions on how public expenditure could be cut without going into the details of individual Departments' spending. In Northern Ireland, we have 11 Departments running a Province of 1.7 million people. There is growing consensus that a Province the size of Northern Ireland does not need 11 Departments; we could get by with a lot fewer.
	We know why that situation came about. During negotiations and debates, primarily between the Social Democratic and Labour party and the Ulster Unionist party, there was a view that we should create many seats around the Cabinet table and elsewhere, to accommodate parties. People need to move on from that and ask, "What is in the best interests of the people of Northern Ireland? What delivers the best value for money?" As regards the duplication of Departments—on that issue alone, before we get down to the issue of cutting the number of Assembly Members and other areas of expenditure that could be looked at—we calculate that we could save the people of Northern Ireland, and the Northern Ireland budget, between £40 and £50 million per annum. That is a significant saving in the context of the Northern Ireland budget. We have to seriously look into that, and I hope that parties in Northern Ireland will do so in the forthcoming period.

Mark Durkan: I fully accept the point that the hon. Gentleman makes. Indeed, I made a similar point in an intervention in the debate last week. Some of the banks in Northern Ireland—I previously named the Ulster bank, for instance—are, according to some of the business customers that I have been talking to, are engaged in bondage banking practices. They are trapping and binding people with ever higher rates and charging them very high re-arrangement fees for that purpose. It is not only the Ulster bank that is doing that.
	Banks are operating in the current situation not just to try to extract more money from some businesses but, I believe, to price some businesses off their books and to force firms that are otherwise sound and that are good medium to long-term investments into liquidating and possibly aborting their sound business prospects. We have heard that from all parties in all corners of the House when they refer to banks in their areas and how they are treating businesses.
	That is why we cannot rely on Treasury Ministers to receive the monthly reports that are meant to come via the lending panel. That is no credible scrutiny or oversight. It is no credible way of guaranteeing that the commitments made by the banks, we are told, towards business lending and other lending areas will be honoured in practice. A bank in Northern Ireland has large banners up with the message, "Lending isn't ending", but that is not the message that customers get when they speak to the bank.
	We need to examine our procedures as a Parliament in respect of the special and hopefully temporary intervention in the banks, which will obviously take some time to manage. There are aspects of the Budgetary process that the House should consider. Because of the scale of the issues with which the Government are contending, they could use parliamentary scrutiny to assist in the better proofing and control of expenditure. In his contribution the hon. Member for Belfast, North referred to the Chancellor's projection of efficiency savings later in the Budget cycle, and he spoke of the implications of those for Northern Ireland.
	The fact that the Chancellor is able to project those efficiency savings right down to the impact that they will have on the Northern Ireland block in a couple of years is interesting, but should be set against the fact that there is still no move to curb expenditure or cut out altogether some of the prestige follies that other hon. Members have mentioned. I refer to ID cards and the huge expenditure that there will be on those. There will be a huge outlay on replacing Trident—a huge prestige folly that might have something to do with people's idea of status, but has very little to do with serious modern defence strategy. Other prestige follies include massive, expensive and very questionable databases in the health service and elsewhere. The announcement of some pullback in relation to the telecommunications database was welcome.
	If the Government are serious, and if we as a Parliament are to be serious about trying to rebalance the Budget, which the hon. Member for Gainsborough (Mr. Leigh) spoke about, we must ask how we in Parliament play our role in that. I believe that in some cases Parliament is better than Government at controlling expenditure on such prestige follies, precisely because of the "Yes, Minister" syndrome that the hon. Gentleman mentioned. Such projects become big status issues and big totemic demands within Government. Nobody out there in the country particularly wants them, but Government have a huge need for them and Government know best. There is also a false belief that Government can spend and buy better. More parliamentary control of those big ticket items would be a great help in the future. We need to consider structural reform of the way that we manage Budgets in the House.
	There were significant measures in the Budget, not just the high borrowing figures and the implications for future spending. Because of all the other details in the Budget, perhaps we have lost sight of the Budget's significance in terms of carbon budgeting. It is the first big step towards that. Many people say cynically that the Government have produced a Budget for the short term, with a view to the election, but we should appreciate the enormity and the significance of the carbon budgeting measures. Some hon. Members might disagree with the value of that measure in the present context, but it proves the sincerity of the Government's commitment. The exigencies of the current circumstances are not being used as an excuse to pull back from those principles and targets.
	In the context of the commitment to carbon budgeting and the Budget's positive interventions, there is the £750 million strategic investment fund and the high profile that has been accorded to the low-carbon economy to ensure that we have a green recovery from the recession. I, like the hon. Member for Belfast, North, hope to see Northern Ireland companies avail themselves of that fund and flex their innovatory muscles to make the most of it.
	There are other interventions in respect of business, including some on taxation, so that people can offset losses this year against previous tax. That is very welcome in the circumstances. The measures on payroll shelter and short-work schemes are very important, and I and others will want them reflected in Northern Ireland, using our devolved capacity. We have argued for such measures.
	Given the range of measures that different parts of the manufacturing sector require, we must ask the Government to create a proper framework for intervention. Many different measures have been announced for the short term, and some in the Budget are projected for the short term, but the method whereby different measures are announced by Lord Mandelson in one meeting and then announced somewhere else does not convey the sense of a coherent framework of intervention, and we need one.
	We must ensure also that Europe plays its role in properly allowing creative intervention nationally and regionally. The First Minister and Deputy First Minister of Northern Ireland were in Brussels recently, and the President of the Commission encouraged them to use public spending innovatively. Sometimes, concern about EU state aid rules gets in the way of the innovative use of public expenditure, and EU state aid rules can be called on and used against positive intervention measures. Although the EU says that it is trying to relax those rules, there is no clear framework for what is and is not relaxed, so, when people speculate on possible proposals to help particular sectors and industries, they are not quite sure where things will stand with regard to state-aid. We therefore need to press Europe for a clear regime, so that, nationally and at a devolved regional level, we all know our discretion to intervene to support our competitive businesses, and they are not counted out under those rules.
	We must recognise that, through some of the Budget's other measures, the Government have shown a continuing commitment on child poverty, including the provisions on child tax credits. I also strongly welcome the measures in respect of pensioners to extend the enhanced winter fuel allowance and, on pension credit, to relax the rules on savings limits.
	This has been a mixed Budget in very difficult circumstances. We need to recognise that we are in an unprecedented matrix of uncertainty, and, in that situation, we cannot all rely on all the projections. I fully accept that some of the Budget's projections are on the optimistic side, but I am glad that it includes, first, commitments that show the Government's determination to try to protect businesses and people in the front-line economy just as much as they tried to protect the banks, which the Government did not do just because the banks wanted it, but to try to ensure that we, ourselves, had a basis for economic stability; and, secondly, measures to try to offset the impact of unemployment and reverse its pattern where it takes hold, so that it does not just hit and, then, drill down and pervade the economy. Such interventions are welcome, but they will have to be developed, and I hope that the Government listen to Members of this House as we come forward with more schemes and ideas as to how best we can do that.

Lynne Featherstone: I recently went to visit my local citizens advice bureau to see how its staff were faring in the economic downturn. They told me that their recent figures show that visits have increased by nearly half in the past year, and painted a stark picture of the recession in Haringey. They have seen a 44 per cent. increase in visits from residents of Hornsey and Wood Green compared with last year. Most of those new inquiries were job-related; almost twice as many people as last year are asking for employment advice. Unemployment has a knock-on effect on other areas of concern such as debt and benefits advice. Between 2007-08 and 2008-09, there has been a 60 per cent. increase in debt inquiries and a 30 per cent. increase in benefits inquiries.
	A whole raft of people who are usually employed have become, in a sense, a new wave of unemployed. They have no experience of how to work their way round a benefits maze or to understand their statutory rights or what is available to them in help from the Government. Many of my local residents are clearly struggling with the recession and in need of such help and advice. The best way to be recession-proof, or as much so as possible, is to know one's rights and entitlements. The citizens advice bureau is therefore vital. I saw a constituent this week who is not so well, and she has been trying for four weeks to be seen at the local CAB. It has a queuing system, so people have to get there very early in the morning. Because my constituent is not well, she waits for an hour and then has to go home again. It is no use having a citizens advice bureau if it is buckling under the weight of the rising number of inquiries resulting from the effects of the recession and if it does not have enough advisers to cope with demand. Given that dramatic rise in inquiries, I was disappointed that there was nothing in the Budget about extra grant funding. Of course, I am on to the local council, Haringey, as well, but its main funding comes from national Government. I am sure that my constituency is not alone in being affected.
	I have been to speak to the North London Network, which comprises very small businesses, including one-person businesses. They are suffering dreadfully. The banks are still not extending loans to them, and there is no relief from their landlords in terms of moratoriums on rent rises. I wondered about the possibility of automating small business rate relief. That is quite complicated to apply for—I think that it is based on square footage—yet it is worth about £1,200 a year to small businesses. It would help them enormously if it were automatic.
	We recently had a debate in this House on what would happen to women in the economic downturn. We agreed, on a cross-party basis, that it would be tragic if the high level of female employment and the advances made on equality were swept away by the recession. Women already have a tough time in the workplace. It was clear from the debate that sectors such as retail and services, which are populated mainly by women who are already poorly paid, would be hit extremely hard, as would part-time work.
	Another problem is employers and others apparently believing that somehow women's earnings are not as important as men's and that if someone has to go, it should be a woman. I have not told the hon. Member for Bromsgrove (Miss Kirkbride) that I would mention her, so I apologise to her, but she raised that issue in the previous debate, saying that she had known people who had heard of such situations. She was absolutely right in her contribution.
	We must also consider maternity costs. In a recession, with employers facing unprecedented challenges in maintaining the viability of their businesses, maternity benefits may be a cost too far, particularly for good employers who pay above the statutory minimum. As employers try to squeeze their costs down, it is not hard to imagine that firms offering maternity pay plus benefits will begin to reduce such costs. Women who choose to stay in work rather than be persuaded out of it will have to manage on a very low amount if their benefit is reduced to the statutory minimum, which is £117.18 a week. Miraculously, most women receive about £400 a week because of good employers providing maternity pay plus benefits. That is a substantial difference.
	Alternatively, if offers are made to women not to come back to work after maternity leave, and instead to receive a redundancy package, it is reasonable to assume that some will exit the workplace. Evidence about that is being collected. They will then face even greater barriers to getting back into work in a few years' time.
	The Minister for Women and Equality and the Government held an event—I want to say a bit of a do—at No. 11 Downing street for women from across the country, who gave evidence about their experience of what the recession is doing to women. That is clearly a major concern, but I did not hear anything in the section of the Budget about helping people fairly that would give direct help to women in the circumstances that I have mentioned.
	There is also a danger that in the recruitment process, employers might favour applicants with no children. In an economic downturn, anybody with children is at a disadvantage if they apply for a job. According to the Equal Opportunities Commission in 2005, before it became part of the Equality and Human Rights Commission, 30,000 women a year were sacked for being pregnant. More recently, Nicola Brewer, the chief executive of the commission, said that women were not being employed because it was better for employers not to take them on, as they might open themselves up to the risk of further costs through maternity benefits. It will be terrible if our maternity benefits, which are relatively good although with room for improvement, become a cause of women not being able to access jobs. If the situation is bad now—that was a couple of months ago—we can expect that women will find it harder and harder.

Stephen Hammond: It is more likely to be Ali Bongo. He was a failed magician and these are likely to be failed forecasts.
	Page 181 of the Red Book says that UK GDP will contract by 3.25 per cent. in 2009. It then states:
	"As macroeconomic stimulus builds and credit conditions ease"
	there will be
	"annual growth of 11/4 per cent. in 2010"
	and
	"31/2 per cent. in 2011".
	We have to ask ourselves whether that is actually credible.
	Let us forget the fact that the IMF disagrees with the 2010 number, and the fact that the Chancellor has just put up the 2011 growth number by a whole percentage point against the figure in his pre-Budget report. The real test of credibility is found in testing against the evidence of history. History teaches us first that recessions are not common, and secondly that quick recoveries from recessions are not common either. Typically, once a trough is reached—this is the point about a U-shaped or V-shaped recession—it takes two years to return to trend growth rates.
	Let us consider the two recessions that are referred to in the Red Book. During the recession of 1979 to 1982, the first quarter of negative growth happened in the first quarter of 1979. However, the recession was not evident until the fourth quarter. We had consistent negative growth through to the first quarter of 1981 and we did not return to trend growth until the first quarter of 1983. The recession of the 1990s followed a shallower but similar pattern. The first quarter of negative growth was in Q3 of 1990 but it was not until Q3 of 1993 that we returned to trend growth.
	It seems to me that what the Chancellor has postulated, which is that we will see a growth of 3.25 per cent. in 2011, borders on the incredible. The first negative quarter of growth in this recession was in the third quarter of 2008. We have had three quarters of negative growth since then. It is quite clear from the Chancellor's prediction for the fall in GDP this year that we will continue to see negative growth quarters up until the fourth quarter of this year—let us be optimistic and say that that will be the last quarter of negative growth. The point is that we will not see any return to trend growth until at least two years after that, which takes us well beyond the Chancellor's expectations for 2011.

Brooks Newmark: I was taken by the age of my hon. Friend's new son. Is my hon. Friend aware that his son will probably be 23 or 24 years old before we return to a debt:GDP ratio of about 40 per cent?

Tobias Ellwood: My hon. Friend makes a valid point. We are at the mercy of the gilt markets and there is a danger that we will lose our triple A rating as a result, which would have a devastating effect on the economy.
	Today, embarrassingly, many hon. Members have taken us down memory lane: rather than talk about this year's Budget, we have heard all about life under Margaret Thatcher. They fail to remember that it was Denis Healey, the Chancellor at the time, who in 1976 had to go the IMF, first for a loan and then to be bailed out completely. I have a sneaking suspicion that we are wandering down that road again. I hope not.
	Where did the money go? Where was it all spent? We have had a decade of boom, but it all seems to have disappeared. We all remember the stealth taxes, the doubling of council tax, the increases in corporation tax and the raid on pensions mentioned by my hon. Friend the Member for Wimbledon (Stephen Hammond), which have given Labour a staggering £1.5 trillion extra since they came to power in 1997. Where has it gone? The budgets for schools and hospitals have doubled, but can we say that services have doubled? No, we cannot. That money has been spent, but it has disappeared.
	Every year, 34,000 people die unnecessarily in our hospitals. Cancer survival rates are still 20 per cent. lower here than in other European countries. Somebody catches MRSA or clostridium difficile every 10 minutes and one dies every 80 minutes. That is a scandal, considering how much money has been spent on the health service. In education, the story is the same. The number of NEETs is increasing and one in four primary school children fail to meet basic standards. Now, the funding problems in the Learning and Skills Council are threatening sixth-form places at the very time when people need education.
	Many hon. Members have asked what the Conservatives would do. We have made it clear. Under Labour the economy has been built on debt, which is why my right hon. Friend the Member for Witney (Mr. Cameron) said at his spring forum speech that Britain needs a "complete change of direction" to deal with the new "age of austerity". We need a plan for economic recovery based on savings and ownership, not borrowing and debt. We need a new low-carbon, high-skilled productive and balanced economy that will be the engine of sustainable growth for years to come, and we must reform the public finances and our system of financial regulation, so that no Labour Government will be able to bankrupt us again.
	Tackling Labour's debt crisis entails ensuring that the Government live within their means—that we control public spending and deliver more for less. That needs to start immediately—not in one or two years' time, but straight away. We need a new culture of thrift in government, because it is not Government money, but taxpayers' money. We need to cure our big social problems, not just treat them. That means school reform, welfare reform and strengthening our families.
	Never has it been so easy to turn one's back on responsibility—to give up on education, knowing that the state will pick up the bill. Only now have the Government realised that and started to make amends, but their approach has had a cultural impact that could take a generation to shift. Instead of harnessing the full economic potential of the next generation, this Government have fuelled a cultural shift toward mediocrity. Surely we should be rejuvenating the next generation, encouraging them to stay in school until they are 18 not because the Government told them to, but because they want to; and to seek a job not because otherwise they would lose benefits, but because they have a skill on which they can build, for which they can be paid a good salary and of which they can be proud.
	Finally, I shall discuss an important subject that the House often overlooks: British tourism. With exchange rates where they are and with the opportunity of the Olympics heading our way, tourism is our fifth biggest industry, but, as I said, it is overlooked. Tourism is worth £114 billion to the economy, is twice the size of the IT services sector and four times the size of the agriculture sector, but it does not get the attention it deserves. It sustains more than 2.6 million jobs and is responsible for one in every four new jobs created here in the UK. It is worth our attention because every pound that Visit Britain spends abroad brings £25 back into the economy. How many other departments can say that their spending money in that way brings money back into this country's Exchequer? I want more emphasis on how we can take advantage of that.
	The UK is the sixth most popular place to visit in the world, but this Government do not recognise that. They have just cut Visit Britain's budget by 20 per cent., which is a scandal. There is no leadership in the Department for Culture, Media and Sport. Regulations are created in other Departments, but the DCMS has no say at all. Visa costs went up by £130 per cent., and DCMS had no say in the matter. Fire regulations are hitting bed and breakfasts hard; DCMS had no say in the matter.
	I think that it is page 8 of the Red Book that shows that there is to be a removal of tax relief on holiday lets; that was done without any consultation with DCMS whatever. We have no idea what the impact will be on the industry, and how many holiday lets will close. The measure will, of course, affect places such as Fowey in Cornwall, where I spent a week during the recess. If those places close, it means a loss not just to the individual who provides the let, but to local pubs, the local community, and the tourism operations there.
	There is also the issue of structures. The creation of the regional development agencies has taken responsibility for tourism away from a body with a national voice, such as Visit England, and given it to the nine regions, which ended up competing with each other in a confusing and overlapping system. The irony is that the Government have now realised that and are reinvigorating Visit England, but it is a decade too late.
	There is not enough time to do justice to other issues, including the closure of 36 pubs every single week. The increase in duties is a tax on the many, not the few who drink irresponsibly. The VAT reduction to 15 per cent. was not helpful at all, because people in the retail and tourism sectors were already giving 10, 15 and 20 per cent. discounts. Why on earth are the Government changing VAT back to 17.5 per cent. on 31 December, at the end of this year? I do not understand that, and I hope that the Treasury Ministers on the Government Bench will take this issue away and consider it. That has to be the busiest period for any bar, pub or club, or any retail outlet. I ask the Government to take a look at that, and to shift the change to a different day.
	There was reference in the Budget to bingo; VAT on bingo has now been removed. That has long been called for, but what the Government give with one hand, they take away with the other, as gross profits tax has gone up to 22 per cent. That means that bingo clubs will start closing across the UK. The dear old ladies who like their one night out will have nowhere to go. Bingo halls are part of our community. People who choose to take part in soft gambling may migrate to harder forms of gambling. That cannot be good, so I ask the Government to reconsider that. There is also the issue of what to do with regard to the announcements on swine flu. I just want to show the House the  Evening Standard . It says: "Killer flu virus 'already circulating in London'". That does not help British tourism at all.

Philip Hammond: As many of my hon. Friends have pointed out, we have scarcely reached the end of the Budget debate, and already its subject has fallen part. After four days of parliamentary scrutiny, the Chancellor's Budget, which was flimsy when it was delivered, has comprehensively unravelled. It is already looking as fanciful as the pre-Budget report quickly became. The past week has seen the final nail in the coffin of what little remained of Labour's economic credibility. Within minutes of the Chancellor sitting down, his growth forecasts were flatly contradicted by the International Monetary Fund, and his Budget was condemned by the CBI as lacking a "credible and rigorous" plan to restore the public finances.
	Within days, the first quarter growth showed the economy contracting far faster than the Chancellor indicated in his Budget statement, undermining the foundations on which the entire Budget was constructed. The right hon. Member for Neath (Mr. Hain), who is no longer in the Chamber, said that the growth predictions were lower than the Chancellor had predicted five months ago. In fact, they were lower than the Chancellor had predicted two days ago. I was struck—and I suspect that many of my colleagues were, too—by the tone of Labour Members' speeches this evening. They just do not seem to have grasped the implications of the Red Book for future spending, or the fact that it is already obsolete, reflecting, just a week after the Budget, a best-case outcome if economic recovery is far quicker and stronger than the IMF and all other reputable commentators have predicted.
	I was asked on Sunday whether I had any idea how the Chancellor had arrived at his 3.5 per cent. growth prediction for 2011. I think I do. My very first boss showed me something that he called the "right-hand up" budgeting approach. He started in the bottom right-hand corner of the spreadsheet with the number he wanted to reach, and he worked up to the top left-hand corner, filling in the numbers that he needed to get the answer he wanted. It is an exercise in fantasy forecasting that undermines not only the robustness of the Budget but the credibility of the entire process. The case for an independent office of budget responsibility, proposed by my hon. Friend the shadow Chancellor, has never been made more eloquently than by the Chancellor himself in presenting those fantasy forecasts last week.
	What the country needed last Wednesday was a clear, objective and realistic statement of the position that we are in and a deliverable projection of future growth and revenue—a Budget that set out the measures needed to restore the public finances from that real base, not from fantasy figures, restoring a discipline to fiscal policy making that has sadly evaporated. What we got was a Budget that had more to do with saving the Prime Minister than with saving the British economy. As usual, it was based on spin.
	The story of the day was supposed to be the new 50 per cent. tax rate, signalling not just the casual breaking of another manifesto pledge, like the pledge to hold a referendum on the European constitution, but a final ritual burial of the new Labour project. If new Labour was about anything, it was about reaching out beyond its traditional core support to a wider public in an aspirational nation. It speaks volumes about the Prime Minister that, facing a general election that will be a referendum on his competence and record in managing the British economy, he has abandoned any attempt at broad appeal, and has refocused his efforts on his core heartland vote, chucking a bit of red meat to those who despise aspiration and success, revealing as much about himself, his values and priorities, as a clutch of unauthorised biographies could ever do.
	We know that the Prime Minister is obsessed with political dividing lines, and the 50p tax rate was supposed to be a new one. He needed it, because the old one—public spending and investment—was rubbed out when his Chancellor announced the most swingeing real-term cuts in public spending since the second world war. We can probably imagine the scene in the Downing Street bunker: things are pretty tense in there anyway—a week or so ago, they had to take one of their own outside and shoot him. Those who are left are understandably nervous. The Secretary of State for Children, Schools and Families, normally a key player, has to keep his head below the parapet, lest someone derails his plans by reminding the electorate that he is in fact the co-author of the Prime Minister's 1,000-year plan for the British economy that has failed so spectacularly.
	A new dividing line was called for, and one was found—no matter that it will damage the British economy; no matter that it will cost jobs in the upturn; no matter the signal that it will send to the next generation of entrepreneurs and inward investors; no matter that the experts do not believe that it will raise anything like the sums of money that the Chancellor is pretending. As the right hon. Member for North Tyneside (Mr. Byers) said yesterday, this so-called policy is mostly about
	"political positioning and tactical manoeuvring"—[ Official Report, 27 April 2009; Vol. 491, c. 615.]
	The subliminal message is supposed to be, "We've got you in a mess, but don't worry. We'll sort it out by taxing the rich." But the British people are not stupid. They have been here before. They know it does not work like that. If one studies the Budget book closely, one sees that it does not even pretend that it works like that, either in the bits that the Chancellor told us about last Wednesday or in the bits that he did not tell us about. In the bit that he told us about, only half the tax increases are paid for by the rich.
	The other half are taxes on ordinary families—on alcohol, tobacco and fuel and, of course, the stupidest tax of all, on jobs, which is the national insurance contribution increase in 2011 that will hit everybody earning £20,000 a year or more, just as the economy is starting to grow again. In the bit of the Budget that the Chancellor did not tell us about, there are another £45 billion a year of tax increases pencilled in to make his numbers add up by 2017, even with his highly optimistic growth assumptions. That is £1,430 per family of extra tax every year for every family in Britain—a secret Labour tax bombshell aimed at the many, not the few, and timed to go off after the next general election.
	Maybe the Chancellor was a little pushed for time when he was making his Budget statement. He seemed to gloss over the dramatic changes in spending plans in his Budget speech. The downgraded spending growth assumption from 1.1 per cent. to 0.7 per cent. was announced without any fanfare. There was no mention, either, of the allocation of £2.3 billion of cuts to the NHS next year, or of the halving of net public capital investment over the next five years—something that Labour have consistently said they would not do in response to economic pressure.
	Let me remind my right hon. and hon. Friends that at the time of the 2005 general election, when the Conservatives were already warning that public spending was growing too fast and needed to be restrained, the Prime Minister told the country that every conceivable efficiency saving had already been made, and that any further reduction in public spending growth would lead to a catastrophic collapse in front-line services. Since that election, he claims to have made £26 billion in efficiency savings. Last November he discovered another £5 billion worth and, last week, he told us that he had found another £9 billion. That is £40 billion in total.
	Let me remind the House what the present Chancellor said back in 2005. He said:
	"Far from being able to fund such huge cuts in 'bureaucracy', £35 billion is actually the equivalent of sacking every teacher, every GP and every nurse in the country",
	yet he has done it, and then some, so he claims. No one believes a word the Government say on spending any more. It is pure political spin. If they had taken our advice then, the public finances would not be in the mess they are in now, and our public services would be more robust, more sustainable and better prepared for the challenges that they will face.
	The truth, which we did not hear in the Budget statement, but had to glean from the analysis of the Institute for Fiscal Studies, is that after taking into account the increase in the service cost of our mountain of debt and the additional cost of benefits to those caught up in this recession, the Chancellor's figures presented last Wednesday represent a real cut of 2.3 per cent. in departmental expenditure budgets after 2011—the biggest spending cut that has ever been imposed in Britain's post-war history. All in all, it was the most dishonest and most partisan Budget that we have yet seen from the Government, and it beat off some competition to win that title.
	The Government talk about fiscal stimulus and counter-cyclical policies, but the only cycle that the Prime Minister has ever understood is the electoral cycle, and that has been the driver of this Budget: a crowd-pleasing, economy-damaging increase in tax on the few before an election; a hidden tax bombshell targeted at the many after an election; a huge increase in public spending before the election; a real-terms cut in departmental spending, on a scale never before seen, after the election. It is not about the economy; it is about the election.
	In my winding-up speech on the Budget last year, I reminded the House that the Prime Minister, when he was Chancellor, used to like to amuse audiences with the thought that there were just two types of Chancellor: those who failed and those who got out early enough. He clearly thought, as he left No. 11 in the summer of 2007, that he was safely in the latter category, but, as his legacy crumbles around him, the British public can now see that he is not only firmly in the former category, but in a sub-class of spectacular and cataclysmic failure all of his own.
	This Government inherited the best economic legacy of any Government since the war.  [ Interruption. ] Oh yes they did. Every single economic indicator was set to positive in 1997, yet they will leave to their successors the worst economic situation since the great depression—worse, even, than the carnage of 1979. The Prime Minister, the man who single-handedly managed the British economy for a decade and, as I remember, was happy enough to take the credit for it when it was going well, is responsible for turning that golden legacy into this disaster. It was he, aided and abetted by the Secretary of State for Children, Schools and Families, who was responsible for the failed system of regulation that prevented the Bank of England calling time on debt, and who let our banks and our households borrow too much; it was he who failed to prepare Britain for the recession, so that we entered it with the highest public sector deficit of any major industrial nation; and it was he who failed spectacularly to deliver the solutions that the nation needs to address the challenges that we now face.
	This is probably the penultimate Budget of this bankrupt Government. They are an economically bankrupt Government, borrowing more than £1 of every £4 that they spend, and presiding over the worst recession and biggest deficit that this country has ever seen, with, according to the CBI, no credible or rigorous plan to restore the public finances. They are a morally bankrupt Government, with a vicious culture of spin, manipulation and sleaze—dodging the truth, postponing the pain and putting off until after the election what for Britain's sake needs doing today. They are inward-looking and focused on saving their own skin at all costs. They said that this Budget was about jobs. Correction: it is about a job. When the Prime Minister talks about his priorities, we know exactly what they are.
	They are an intellectually bankrupt Government, too, because the Prime Minister's only policy, his only solution to every problem, has been to throw more money at it. Any fool can spend money and, to be fair, cut budgets, but, now that the cupboard is bare and the country must start living within its means, the challenge for policy makers is to do things smarter rather than simply to spend more public money. That leaves the Prime Minister devoid of answers to the challenges of the future.
	This Budget was a final opportunity for the Government to level with the British people about the scale of the problems that the country faces, and to set out a clear, credible and rigorous plan for addressing them, but they fudged it. They spun it. Within minutes, the assumptions on which the Budget is constructed were discredited; within days, it had completely unravelled to expose how they have ducked the real challenges. It is now clear that they will carry on playing their political game until finally their time runs out and this unelected, failed Prime Minister can be put out of his misery by the British electorate. Then Britain can start the long process of rebuilding its economy and its public finances and of putting this country back on the path to sustainable prosperity.

Resolved,
	That—
	(1) Section 393A of the Income and Corporation Taxes Act 1988 (losses: set off against profits of same or earlier accounting period) has effect in relation to any loss to which this Resolution applies as if, in subsection (2) of that section, "3 years" were substituted for "twelve months" (but subject as follows).
	(2) This Resolution applies to any loss incurred by a company in a trade in a relevant accounting period (but subject to paragraph (3)); and a relevant accounting period is one ending after 23 November 2008 and before 24 November 2010.
	(3) The maximum amount of loss to which this Resolution applies in the case of any company is—
	(a) £50,000 in relation to losses incurred in relevant accounting periods ending after 23 November 2008 and before 24 November 2009, and
	(b) £50,000 in relation to losses incurred in relevant accounting periods ending after 23 November 2009 and before 24 November 2010;
	and the overall limit or limits apply whether a loss is incurred by the company in only one relevant accounting period or losses are so incurred in more than one such period.
	(4) Subject to that, if in the case of the company the length of a relevant accounting period is less than one year, the maximum amount of the loss incurred in that period that may be set off under section 393A of the Income and Corporation Taxes Act 1988 by virtue of this Resolution is the relevant proportion of £50,000.
	(5) "The relevant proportion" is—
	RAP / Y
	where—
	RAP is the number of days in the relevant accounting period, and Y is 365.
	(6) The reference in subsection (2C) of section 393A of the Income and Corporation Taxes Act 1988 to so much of the loss referred to in that subsection not falling within subsection (2B) of that section as does not exceed the amount of the allowance mentioned in subsection (2C)(b) ("the subsection (2C) loss") has effect in relation to a relevant accounting period as a reference to so much of the subsection (2C) loss as exceeds that which can be set off under section 393A of the Income and Corporation Taxes Act 1988 by virtue of this Resolution.
	And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

Presentation and First Reading
	Mr. Stephen Timms accordingly presented a Bill to grant certain duties, to alter other duties, and to amend the law relating to the National Debt and the Public Revenue, and to make further provision in connection with finance.
	 Bill read the First time; to be read a Second time tomorrow, and to be printed (Bill 90) with explanatory notes (Bill 90-EN).

Julian Lewis: I am delighted to have secured this Adjournment debate, and I am touched by the fact that so many colleagues have stayed behind to listen to it at this extremely late hour.
	On 12 March a letter arrived in my party leader's office, complaining about my registering anonymously rather than publishing my address on the New Forest, East electoral roll. That is a basic security precaution, taken because of the work that I did before, and to some extent after, becoming an MP against political extremists at home and abroad. The letter demanded to know:
	"Who are these political extremists and who has sanctioned such involvement of a sitting MP?"
	It ended with the following pretentious declaration:
	"I view this matter extremely seriously and have therefore also written to Jonathan Evans the Director General of Security Services"—
	sic—
	"(MI5), Sir John Scarlett Chief of the Secret Intelligence Service (MI6) and Mr. Alex Marshall the Chief Constable of Hampshire, in an effort to throw some light on this situation."
	Nonsense of this sort can safely be ignored when it comes from the cranks with whom we occasionally have to deal. In this case, however, the author is a Liberal Democrat prospective parliamentary candidate, a 63-year-old retired military policeman who aims to oppose me at the next general election. His name is Terry Scriven, and his previous attempt to compromise my home address was drawn to the House's attention on 22 July last year. Since then, his campaign to blacken my name has intensified, most recently with the connivance of the  News of the World. It has therefore become necessary to return to this subject.
	I realise that the Deputy Leader of the House will not be able to address my situation in detail, and he knows that I can give him only a little time in which to reply, but I trust that he will confirm that not just the press but even political opponents have a duty to show some restraint where the personal security of parliamentarians is at stake. What has happened to me illustrates the mischief that malicious adversaries can make.
	In setting their prospective candidate's antics on the record, I mean no disrespect towards Liberals in my constituency in general. I have worked with Liberal Democrats to save community hospitals, and even now I am working with their group leader on the district council on an issue on which we agree. Several of them have told me privately of their dismay at Terry Scriven's tactics.
	I have previously fought three general elections in the New Forest without experiencing anything comparable to the events of the past few months. In 1997, when my seat had just been formed, the Liberal Democrat candidate was a New Forest district councillor, George Dawson. He fought a clean campaign. In 2001, my Liberal Democrat opponent was a county councillor called Brian Dash. I had worked with him on a cross-party basis to oppose the construction of a container port on sensitive land at Dibden bay. Before the 2001 election, I spoke to Mr. Dash about my constituency home. I told him my address and explained that if he looked it up on the electoral roll, he would find that as a basic security precaution, I was registered under a nom de plume. I added that that was by arrangement with the electoral registration officer at the district council, and I invited him to visit my home so that he could satisfy himself that it was genuine. He assured me that no such visit was necessary, that he fully appreciated why I had made the special registration arrangements and that they would never be an issue between us in an election campaign.
	Brian Dash kept his word, not only in the 2001 campaign but in the 2005 campaign, when he stood against me for a second time. By then, my seat had become a target for the Liberal Democrats and that campaign was not clean. Tacticalvoter.net, a left-wing group, infiltrated the local Labour party and installed Stephen Roberts as the Labour candidate. He worked hand in glove with the Liberal Democrats to try to oust me. Yet, despite the bitterness of that battle, the Liberal candidate, Brian Dash, kept his promise not to make an issue of the steps that I had taken to protect my home address.
	Following my improved majority in 2005—which may have had something to do with Tacticalvoter.net—and a boundary change helpful to the Conservatives, I learned that the Liberal Democrats would not be targeting my seat next time. That is apparently why they allowed Terry Scriven to become their candidate, despite the fact that he lives miles away from New Forest, East, on the far side of New Forest, West, and has given no indication of moving into the constituency that he says he wishes to serve. Since becoming a prospective parliamentary candidate in 2007, Mr. Scriven's impact on my constituency has been vanishingly small. Knowing that he cannot defeat me politically, he has gambled everything on trying to smear me personally.
	When I worked as a political researcher in the 1980s and early 1990s, I spent a lot of time ferreting out facts about left-wing political opponents. For example, I am holding a 250-page directory of Labour Members of Parliament and left-wing causes, which was published in the run-up to the 1992 general election. Yet nowhere in that book or in any of my other political research work will hon. Members find cases of my using personal rather than political information against any of the people featured. Indeed, until I encountered Mr. Scriven, I had never felt it necessary to consider personal misbehaviour by a political opponent.
	Last year, I began my campaign to neutralise the extraordinary decision of three High Court judges that MPs' home addresses should be revealed in response to freedom of information requests. In part, the judges based their ruling on the fact that all general election candidates had been required since the late 19th century to disclose a home address on nomination and ballot papers. We changed the law on MPs' addresses by statutory instrument in July 2008 and we are in the process of doing the same on candidates' addresses after the free vote on 2 March 2009. Significantly, the date of that vote was only 24 hours later than the smear story against me in the  News of the World—I do not think that that was a coincidence.
	I began the campaign to protect MPs' home addresses by making a speech on 22 May 2008, in the debate on the Adjournment, and I openly referred to my practice of registering under a nom de plume by arrangement with the electoral registration officer. That gave Terry Scriven his first opportunity. As I now know, on 25 June 2008, he e-mailed the chief executive of New Forest district council, Mr. Dave Yates, who is in overall charge of electoral registration, as follows:
	"As you are aware Julian Lewis MP, I am led to believe, lives at"—
	he then gave my constituency home address—
	"and is registered on the Electoral Role"—
	typically spelt like that—
	"under a false name (I am able to provide the name if helpful). Are you able to confirm that this is the case? Would you also state under which regulation this procedure is authorised and by whom? I am not trying to create any waves here just to understand facts so that I do not ask silly questions in public. I must also add at this moment I have no intention of making information I have in my position"—
	I presume that he meant "possession"—
	"if correct, public".
	Mr. Yates replied that I had indeed registered in that way, by arrangement with the previous electoral registration officer, for reasons of personal safety. That had happened for a number of years but, Mr. Yates told Scriven, now that a new system of "Anonymous Registration" existed, I would be asked to use that instead of the nom de plume method in future.
	On 11 July, Mr. Scriven replied to the chief executive in the following apparently generous terms:
	"Your email is very clear. I fully understand the reasons for Julian wishing to keep his private address confidential despite it appearing on the election forms and the agreement that was clearly entered into. I am sure both Julian and I understand the need for security."
	That was the first but by no means the last time that Mr. Scriven professed to support me in keeping MPs' home addresses confidential. However, his private conduct has been utterly incompatible with his public position.
	As I told the House last July, New Forest district council chief executive Dave Yates was contacted by a Sunday newspaper just seven days after Scriven's supposedly supportive e-mail. The exchange of e-mails between Mr. Scriven and Mr. Yates had been leaked to a journalist called Ben Leapman—the very reporter leading the campaign for MPs' home addresses to be published to all and sundry. The leak could have come only from Terry Scriven, if we exclude impropriety by the staff of New Forest district council, which I am sure we can.
	I have repeatedly asked Mr. Scriven to explain why he approached Ben Leapman to investigate a supposed irregularity in my electoral registration arrangements, when he had indicated to Mr. Yates that he fully accepted the need for those arrangements. Time and again, Mr. Scriven has refused to answer that question. I have also asked him why he chose Ben Leapman as the journalist to approach, given that reporter's hostility towards me for thwarting his efforts to force MPs' addresses to be published. If Mr. Scriven is sincere in his proclaimed support for my campaign to protect MPs' home addresses, Mr. Leapman is the last journalist in Britain whom he should have contacted. That question, too, Mr. Scriven refuses to answer.
	In the end,  The Sunday Telegraph decided not to run Mr. Leapman's story, which simply tried to catch me out for having used a nom de plume for one year too long, rather than the new procedure of anonymous registration that had succeeded it. But Scriven was undaunted. After trying to smear me in  The  Sunday  Telegraph, he immediately wrote to the chief constable of Hampshire, demanding that I be criminally investigated for having registered in that way.

Julian Lewis: I agree.
	That despicable manoeuvre was carried out in full knowledge of the fact that my use of the nom de plume had been explicitly approved by the electoral registration officer. In any case, I had always accurately stated my real name on the voter registration form when signing it, while clearly indicating that the different name on the register was an agreed nom de plume.
	Terry Scriven did not even have the decency to inform me of what he had done, but at once telephoned a local reporter in order to use the press to twist the knife that he had aimed at my back. Fortunately it missed its target, as the following report in the  Lymington Times, dated 16 August 2008, makes clear. The headline is "Chief Constable Scorns Call for MP Investigation" and the story reads as follows:
	"A political rival who reported a New Forest MP to the Police for the way he registered to vote has been blasted by the Chief Constable for wasting officers' time. Liberal Democrat Terry Scriven—who will contest the New Forest East seat at the next General Election—had complained about a discrepancy in Conservative MP Julian Lewis's habit of using a false name on the electoral roll, to keep secret where he lives for security reasons. But Mr. Scriven's action was scorned by Hampshire's top policeman, Paul Kernaghan, who rejected his request for an investigation and said Dr. Lewis had acted 'in good faith' on the advice of the District Council officer in charge of electoral registration. Mr. Kernaghan wrote to the MP: 'I sincerely hope that [Mr. Scriven] will decide to move on, as it is my personal view that this "complaint" does not enhance our collective respect for democracy and the electoral process.'"
	[Hon. Members: "Hear, hear."] I am glad that colleagues agree. Mr. Kernaghan continued:
	"The employment of scarce police resources to investigate whether or not a technical breach of the legislation had taken place would be a total waste of effort and not in the public interest".
	After that outrageous episode, I realised that I was dealing with an extremely unscrupulous individual. Some of the publicity surrounding Terry Scriven resulted in my being contacted by people who had previously suffered at his hands. Three were from the military police, but I cannot report what they said in language permissible in this Chamber. It boiled down to the fact that Terry Scriven's conduct had shown him to be a devious and two-faced bully who operates in the dark and never owns up to what he has done. My experience has confirmed that assessment in every respect.He blatantly refuses to answer any questions put to him about his own conduct, his sole response being to accuse me of trying to "intimidate" him by posing such questions.
	That is irony indeed, coming from a man who has to date put in no fewer than 16 freedom of information requests to the House of Commons, 12 of which directly relate to me and my staff. He has refused to say, inter alia, why he used the Freedom of Information Act 2000 to request—unsuccessfully—the address of my flat in London, given his repeated statements of support for my campaign against the disclosure of MPs' home addresses. He has also refused to say why, when he tried to have me investigated by the police, he told the  Lymington Times reporter that he had done so but did not tell me, or why he complained, also unsuccessfully, to the Parliamentary Commissioner for Standards about my parliamentary caseworker, but did not tell her about this. He would not say why, when he complained to Sir Neil Thorne about the frequency of my participation in the armed forces parliamentary scheme—the AFPS—this was yet again done behind my back.
	Sir Neil is admired in all parts of the House for setting up and running the AFPS. On 16 March this year, he wrote to tell me how much disruption Scriven's vendetta was causing. Sir Neil states:
	"Since my last correspondence with him, it has come to my notice that Mr. Scriven has been in touch with at least six different officials about the Scheme...although I am not directly affected, those who are being asked to respond to these numerous questions about the AFPS are being deprived of time which they ought to be able to spend on operational matters. As you"—
	that is me, Julian Lewis—
	"seemed to be the target of Mr Scriven's original questions, I wonder if you can throw any light on what is the basis for this barrage of further enquiries about the Scheme? Until now, the Scheme has enjoyed unparalleled cross-party support and I am frankly concerned that someone seems intent on trying to disrupt or in some way undermine it in pursuit of some personal political objective."
	The only advice I could give Sir Neil was that this manic and disruptive activity was part of a consistent pattern of behaviour that I have pieced together with the help of those who have encountered Terry Scriven in the past.

Julian Lewis: Well, it's not just that he's a nutter.
	In May 1999, Scriven was elected unopposed as one of half a dozen members of the parish council at Hyde in New Forest, West, the constituency in which he lives. Although he was elected for a four-year term, he lasted just six months as a parish councillor. During that time, he attended only four of the first nine meetings and resigned at the tenth—which was his fifth—after constant disagreements with his colleagues.
	The same happened when he was "elected", again unopposed, to Ringwood town council in 2006 and put on the planning committee. He attended his first council meeting on 26 July, but resigned from the planning committee on 25 October, only three months later, after a blazing row with the other members. In April 2007, the mayor of Ringwood announced, with some relief, that Scriven would be stepping down from the council completely.

Christopher Fraser: They'll give him a peerage.

Julian Lewis: No, I do not think they will give him a peerage. His career as a town councillor in his local area in New Forest, West had lasted less than nine months from beginning to end. This fiasco followed hard on the heels of an even shorter dalliance as a trustee of an educational charity—the Vocational Training Charitable Trust—to whose board he had been formally elected at an annual general meeting on 4 October 2005. Such was his disruptive behaviour that, after attending only two meetings, he was twice asked to resign by the other trustees. He did so on 6 December, only two months later. [Hon. Members: "More! More!"] I must ask colleagues to restrain themselves, as I need to get through my speech in the time allowed.
	All this shows a consistent pattern of deviousness and disruption. Normally, one would simply write Scriven off as a malevolent failure and put one's faith in the good sense of the voters when the election is called. However, this brings me back to where I began, for Terry Scriven has finally had a success. He has managed to get the  News of the World to publish a story falsely accusing me of hardly ever "visiting", as it puts it, the home in my constituency where I have lived continuously for the past 11 years when I am not at Westminster. My genuine neighbours state, correctly, that I am constantly using my home, yet unnamed people, described as "neighbours" and "locals", supposedly told the newspaper that I am "HARDLY THERE"—the quote is all in capitals—enabling it to denounce me for claiming my parliamentary allowance on my London flat, which I am perfectly entitled to do. The newspaper's story contained one factual item: the date on which I changed my main home designation from my flat in London to my house in my constituency. That had never been published before, but it had been disclosed by the House of Commons to Terry Scriven and to nobody else on 11 July 2008, at the same time as his freedom of information request for my home address in London was rightly rejected.
	As Mr. Scriven never responds to any questions that I put to him, other than to accuse me of trying to "intimidate" him by asking them, I had my solicitor write to him on 12 March pointing out that it appeared that
	"the internal evidence in this false"—
	 News of the World—
	"story demonstrates that you were the initiator of it".
	The letter gave him
	"the opportunity (i) to deny any role in the concoction of the News of the World report and (ii) to explain how else the newspaper could have obtained knowledge of the change of designation in June 2004, which was disclosed by the House of Commons only to you".
	It concluded as follows:
	"Our client intends presently to mention these matters publicly"—
	I am doing that tonight—
	"and is offering you this chance to put forward your explanation of events, before he proceeds...Our client's questions are, of course, not intended in any way to intimidate you but are designed to provide you with a full opportunity to respond and to correct any alleged inaccuracies of fact before he comments publicly about your behaviour....If we do not hear from you by 25 March 2009 our client will proceed as indicated, and people will be able to draw their own conclusions from your continued and persistent silence".
	Mr. Scriven replied on 20 March stating that he had
	"previously informed Dr Lewis on a number of occasions, in writing, that I find his actions intimidating...I will place this latest letter with a growing pile of other letters, emails and a message left on my answer phone which I have received from Dr Lewis over a period of almost nine months".
	What Scriven did not do in this letter was to deny for one moment that he had indeed been the initiator of the  News of the World smear. As my solicitor has now informed him, the only reason that a "pile of other letters" exists has been his own behaviour towards me and my staff, and his constant evasion of all questions put to him about it.
	I have little doubt that at some point during the next general election campaign Mr. Scriven will seek to distribute, perhaps unattributably, and perhaps with its date removed in order to make it look current, large numbers of copies of the  News of the World smear story against me—that is, assuming that decent Liberal Democrats who, unlike Terry Scriven, actually live in the New Forest, East constituency, have not finally realised that they made a disastrous mistake in selecting as their candidate someone whose behaviour makes him unfit for any elected position in public life.
	My only defence against the covert tactics of this man is to bring them out into the open in the hope of inoculating the community against their intended effects. I have given him numerous opportunities to explain and justify his conduct, and his only response has been to claim to feel intimidated by me—that is the classic refrain of the bully when an intended victim actually stands up to him. What can we expect next? Will it be a press smear against Sir Neil Thorne or the armed forces parliamentary scheme, or just another smear against me, as a shadow Defence Minister, for daring to spend so much time with the military? Can we expect a demand for the abolition of parliamentary privilege, so that hon. Members cannot rebut scurrilous critics such as Mr. Scriven? Actually—I am not making this up—he has tried that one already. Perhaps we can expect a police raid on my home, because Terry Scriven feels "intimidated" by my asking him to confirm or deny his role in the  News of the World smear?
	I began by discussing Scriven's preposterous letter to my party leader, which, typically, was labelled "In Confidence", so that I should not see his latest attempt to disparage me. It revealed that Terry Scriven expects the director general of MI5 and the chief of the Secret Intelligence Service to tell him if I have ever been involved with either organisation. Perhaps he does not realise that, just as people who work with or for such bodies have a lifelong obligation of confidentiality towards them, the reverse is also true. I can only apologise to them, to the chief constable of Hampshire, to Sir Neil Thorne, and to everyone else whose valuable time is being wasted by intrusive and inappropriate correspondence from this person, who likes to describe himself as the "prospective Member of Parliament" for my constituency. [Hon. Members: "Never!"] I am glad that my hon. Friends say, "Never." This is a calculated effort to blacken my reputation in the eyes of my constituents. Thanks to the internet I have been able to respond quickly to the smears of the  News of the World and to post the full documentation about Terry Scriven's antics in a special section of my website so people can read them and make up their own minds. Despite the co-operation of a certain sort of journalist, I do not think that Mr. Scriven will succeed in the end, but as he has to some extent poisoned the politics of New Forest, East, I thank the House for this opportunity to expose his behaviour and to set it on the record—[Hon. Members: "Hear, hear!"]